As companies seek to modernize their IT infrastructure and cut costs, cloud computing, and the as-a-service economy are gaining momentum. Moving desktops, applications, data, servers, networking, and printing to the cloud can save enterprises significant amounts of money and free up resources for innovation. One of the most widely adopted cloud computing segments is software as a service (SaaS), which allows organizations to avoid the upfront cost and complexity of owning and maintaining their own applications.
The global spending by end-users on software as a service (SaaS) increased substantially from USD 31.4 billion in 2015 to USD 167.34 billion in 2022. The projections indicate that this trend will continue, with estimated spending surpassing USD 232 billion in 2024. SaaS migration can provide numerous benefits, but the process also comes with challenges. In this article, we will explore best practices for migrating to SaaS enterprise solutions, including how to establish a baseline and measure success and strategies for managing complexity and cost.
Why Should You Migrate to SaaS?
Migrating to a software-as-a-service (SaaS) business model can provide significant benefits for organizations.
- One major advantage is cost savings sinTTce SaaS involves third-party providers developing, maintaining, hosting, and supporting software with low initial up-front costs. For example, new research suggests that communication service providers (CSPs) can save about 25% of their IT costs over five years by adopting telecom services provided through a software-as-a-service (SaaS) model. This allows businesses to move from CapEx to OpEx spending through subscriptions, which is more predictable.
- SaaS platforms offer scalability, reliability, security, and ease of operation, allowing businesses to focus on IT innovation instead of managing on-premises software and infrastructure.
- With SaaS, businesses can quickly add new features and upgrades without a major up-front investment in infrastructure and IT staff. The regular delivery of software’s new capabilities and latest security updates online eliminates the need for costly and complicated upgrades.
SaaS Migration Models
The success of the SaaS migration depends on the migration model selected.
Siloed migration model or Silo lift and shift migration model
The silo lift and shift migration model is a simple and straightforward way of migrating an entire tech stack to the cloud without the need for a complete redesign of applications. It is ideal for businesses looking to migrate to a cloud-native infrastructure quickly.
Layered Migration Model
Unlike traditional migration approaches, this one moves each layer incrementally, using parallel migration and automated provisioning. You get to pick the layer to start with and proceed as you see fit. This method lets you preserve the single-tenant design while moving towards a shared system. The layered migration model is an excellent choice for organizations switching to multi-tenancy without disrupting their existing setup.
Parallel Migration Model
The parallel migration model can help overcome challenges associated with cloud migration by creating a new, stand-alone SaaS application that uses a different architecture. This strategy allows developers to create a new product with increased agility and flexibility while avoiding the overhead costs of maintaining a parallel system.
Service-by-Service migration model
If you’re looking to break down your monolithic system into microservices, the service-by-service migration model is the way to go. This approach is the perfect solution for a seamless and incremental migration process.
Best Practices for SaaS Migration
Moving to SaaS may completely alter the course of your business. So let’s take a closer look at how to transition to SaaS enterprise solutions.
Planning for the Migration
Creating a roadmap is a crucial step in SaaS migration. It involves assessing the current architecture and application capabilities, followed by devising a strategy for the future. Through research, analysis, and strategic planning, businesses can determine the amount of work required, establish milestones, and identify potential roadblocks. Collaboration with business analysts, architects, and developers is key to outlining business and application requirements and identifying necessary tools. Organizations can ensure a successful SaaS migration and achieve their desired business outcomes by selecting the appropriate migration model and understanding the costs, benefits, and challenges.
Take the Total Cost Of Ownership (TCO) into consideration
When migrating to SaaS, keeping an eye on the total cost of ownership (TCO) is crucial, as it can be difficult to calculate. TCO refers to the approximate cost of buying, installing, utilizing, and disposing of a product or piece of equipment. It calculates the total cost of ownership throughout the product’s lifespan, taking into account all associated costs. The flexible nature of SaaS means that various factors, such as network traffic, storage, compute capacity, and the number of users, can influence the cost of running SaaS applications. Including these factors in your planning can help you better estimate your TCO.
It’s important to stay aware of TCO throughout the migration process to ensure that you stay within your budget. At STL Digital, we have a transparent procedure to always keep you up-to-date with the TCO.
Think about the SaaS migration models that best serve your clients/customers.
SaaS migration isn’t a one-size-fits-all process; choosing the right migration model is essential for success. Businesses should consider the unique needs of their customers and choose the model that suits them best. Retaining customers throughout the transition is crucial, and their experience should be a priority at every stage of the journey.
The four migration models available – siloed, layered, parallel, and service-by-service – all have their advantages and disadvantages.
- Siloed migration is ideal for quickly migrating an entire tech stack.
- The service-by-service migration model is perfect for breaking down a monolithic system into microservices.
- The parallel migration model, meanwhile, is ideal for businesses that cannot afford to take risks.
- The layered migration model is an excellent choice for organizations looking to switch to multi-tenancy without disrupting their existing setup.
Companies can even adopt a hybrid version of these models to make the transition smoother and easier.
Create new KPIs to better gauge success and predict profitability
Modifying your key performance indicators (KPIs) to account for the transition from conventional licensing models to SaaS is crucial. With SaaS, you will get income as it is produced. Therefore, tracking subscriber attrition, client acquisition, and retention data can help you better assess your success and forecast your profitability. You may track your progress towards your strategic business goals by developing new KPIs, which will also assist in keeping your staff concentrated on the most important tasks. Take the time to collaborate with each department to establish the important goals that will influence your corporate goals and contribute to your long-term success.
In conclusion, businesses seeking to optimize their operations and gain a competitive edge can greatly benefit from transitioning to SaaS enterprise solutions. By partnering with a trusted provider like STL Digital, organizations can leverage the advantages of lower costs, faster implementation, scalability, dependability, security, and user-friendly interfaces. It is essential to choose the right migration model and carefully plan the transition, considering the total cost of ownership. By adopting best practices for SaaS migration, businesses can effectively manage complexity, streamline their IT infrastructure, and allocate resources for innovation. As the global demand for SaaS continues to grow, companies that embrace this trend and collaborate with STL Digital will position themselves for success and drive sustainable business growth.
FAQs
1. What is SaaS?
SaaS is a software distribution model where a cloud provider hosts applications, allowing users to connect and use cloud-based apps over the Internet. It’s a subscription-based licensing and delivery model, providing complete software solutions that organizations rent on a pay-as-you-go basis.
2. How can organizations ensure a smooth transition when migrating from on-premise solutions to SaaS?
To ensure a seamless SaaS migration, planning and executing a proof-of-principle project well before the migration event is crucial. Additionally, it’s essential to maintain up-to-date contact information for both the local IT team and the SaaS provider’s technical support team to tackle any unforeseen issues.
3. How can organizations ensure that their data is properly secured and protected during the SaaS migration and post-migration phases?
Here are several steps you can take to guarantee data security when migrating to a SaaS platform:
- Evaluate your current data situation
- Make sure you understand your compliance requirements
- Select appropriate data security tools
- Encrypt the data while it is in transit.
4. What are the risks associated with SaaS migration?
Here are some risks associated with SaaS migration:
- Risks of data security
- Not having intensive knowledge and a well-defined cloud migration strategy
- Migrating to a new SaaS application and training staff to use it incurs a huge amount of cost.
